Data centre firm Flexential announced a strategic investment from Morgan Stanley Infrastructure Partners.
Morgan Stanley has invested in US data centre firm Flexential. The company announced a strategic investment from Morgan Stanley Infrastructure Partners (MSIP). Terms of the deal were not shared.
MSIP is partnering with GI Partners to accelerate Flexential’s growth. MSIP will invest in the common equity of the company as a co-control investor alongside GI Partners.
The transaction is expected to close in the fourth quarter of 2024 upon completion of customary regulatory approvals.
“The new partnership with Morgan Stanley Infrastructure Partners, combined with the strong foundation laid with GI Partners, represents a tremendous opportunity for Flexential to further accelerate our growth trajectory and sets the stage for future strategic opportunities,” said Chris Downie, CEO of Flexential.
“As we continue to invest in expanding our infrastructure and delivering innovative solutions to our customers, this additional investment will enable us to build on our recent successes and further strengthen our position as a leader in the data centre and digital infrastructure industry.”
Flexential has a portfolio of more than 40 data centres across the United States and more than 325 MW of built and under-development capacity. The company said the new investment will help fuel Flexential’s ongoing growth strategy, enhancing its market presence.
Founded in 2006, Morgan Stanley Infrastructure Partners is a private infrastructure equity investor, targeting assets that provide essential public goods and services primarily located in OECD countries. Funded by pension, sovereign wealth, and insurance companies, its investments include transportation, digital, energy transition, and utilities.
“We are excited to partner with Flexential at this critical moment in the company’s evolution,” said Christopher Ortega, head of Americas, MSIP. “We believe Flexential’s robust next-generation infrastructure, commitment to innovation, and proven leadership in the industry make it well-positioned to capitalise on market opportunities. We look forward to supporting the company’s continued growth and success in the years to come.”
Investment firm GI, which founded and then divested Digital Realty, has stakes in a number of data centres and owns US operator LightEdge. Earlier this year it acquired Pennsylvanian regional fibre firm DQE Communications.
GI formed Flexential in 2017 after merging Peak 10 and ViaWest. GI acquired Peak 10 back in 2014.
“Flexential has proven its leadership in reliable delivery of critical data centre services to the most sophisticated customers in the world,” said Travis Pearson, Managing Director and Co-head of Private Equity, GI Partners. “The Flexential leadership team has paved the way for sustained growth, and we are thrilled to welcome Morgan Stanley Infrastructure Partners as a partner to help drive the company’s future success.”
Ropes & Gray LLP acted as legal counsel to Flexential and Goldman Sachs & Co. acted as exclusive financial advisor to Flexential and GI Partners. Kirkland & Ellis LLP acted as legal counsel to MSIP, Citi acted as lead financial advisor to MSIP and Evercore also served as financial advisor to MSIP.
